Ensuring that regulators are accountable for their actions can strengthen their performance and increase transparency. Many economic regulators in OECD countries are independent bodies with a strong degree of autonomy in decision making, and they hold significant powers to regulate key network sectors. Their independence supports public trust in the objectivity and impartiality of their decision making which can, in turn, strengthen the confidence of market actors to make necessary investments in the sector. However, as independent regulators are neither elected nor directly managed by elected officials, there should be a balance between independence and measures that facilitate accountability (OECD, 2014). Governments, businesses and society at large expect regulators to drive sector performance and make efficient use of their resources, without imposing unnecessary regulatory burdens. Robust accountability arrangements can help assess and demonstrate how well economic regulators are delivering this mandate. By showing greater levels of accountability and transparency, regulators can demonstrate their integrity, efficiency and effectiveness.
The 2018 OECD Indicators on the Governance of Sector Regulators map the governance arrangements of regulators across the energy, e-communications, rail transport, air transport and water sectors. On average, energy and e-communications regulators in OECD countries have the strongest accountability arrangements, while those in the transport sectors (air and rail) report the fewest arrangements in line with good practice (Table 7.10). Accountability arrangements are closer to good practice when regulators are directly accountable by law to parliament or congress, consult on their decisions with stakeholders and publish information on the performance of their organisation and the sector (Casullo et al., 2019). In some cases, these accountability mechanisms are a result of a legislative requirement for the regulator, such as the requirement to publish draft decisions and collect feedback. In other cases, regulators proactively enhance their accountability by publishing information without a legislative requirement (Figure 7.11).
The data also confirm that, in practice, independence and accountability are two sides of the same coin. Online Figure G.30. provides an overview of the independence and accountability scores of individual regulators across the energy, e-communications, transport and water sectors in OECD countries. The chart shows a statistically significant correlation between the two (with a Spearman’s correlation coefficient of 0.6), meaning that accountability scores tend to be closer to good practice for regulators that are more independent. This correlation is particularly strong for energy and e-communications regulators.
